Credit Suisse And Scotia Above-Consensus On CPI

Credit Suisse is looking for a slightly above-consensus outturn in September core CPI, at 0.3% M/M, and headline at 0.4% (0.1pp above consensus in both categories). They see headline boosted by food and energy prices.

• Meanwhile, Scotiabank asks whether August's unexpected deceleration in inflation was "a transitory development or the start of a falling trend in the pace of price changes? We'll find out when the September readings arrive on Wednesday. It will help to inform pricing power and hence one contributor to growth in nominal earnings as a driver of nominal stock market benchmarks."
• They see August as a "temporary soft patch for pricing power", and like Credit Suisse are looking for 0.3% M/M core and 0.4% M/M headline readings, with potential upside risks to the core measure.
• This is in part due to higher new and used vehicle prices. But they also see some of August's "abrupt price movements" unlikely to repeat, including in Delta sensitive categories such as airfares and hotels.